Repairs, assembly, production, and integration of systems purchased abroad with products from the domestic industry are some of the ways to achieve the so-called polonization of equipment. This requirement has accompanied defense contracts for decades, but today, it has become a key condition in negotiations.

Col Robert Frommholz: “In the K9 system, we acquired only the self-propelled howitzers themselves, while all the accompanying equipment, i.e. command vehicles, ammunition resupply vehicles, and artillery armament repair vehicles, are Polish solutions.”

Involving a country in the production, maintenance, and modernization of foreign-purchased equipment can be achieved in various ways. For more than two decades, the most well-known path to localization was offset, originally intended not only to serve the defense industry, but also to compensate the economy for the money that the state is spending on defense abroad. One of the examples is the Opel plant, established in Gliwice by General Motors as compensation for Poland’s choice of F-16 fighter jets.

Col Robert Frommholz, Deputy Head of the Polish Armament Agency, points out that the concept of polonization is not defined by law. “The Armament Agency treats polonization as establishing production and service capabilities related to the product’s life cycle in Poland. This can be carried out directly by the foreign contractor, by a Polish company, or within the military based on granted licenses or transfer of material components, industrial or service capabilities by the foreign contractor,” explains Col Frommholz.

Polonization can mean adapting foreign military equipment to meet the requirements of the Polish Armed Forces, using components and solutions supplied by domestic defense industry entities, or replacing foreign military equipment or service with a Polish solution. “In other words, we buy abroad only what we really have to, and whenever we can, we look for domestic solutions,” explains Col Frommholz. “We’ve done this, among others, in the case of the K9 system, where we acquired only the self-propelled howitzers themselves, while all the accompanying equipment, i.e. command vehicles, ammunition resupply vehicles, and artillery armament repair vehicles, are Polish solutions,” he notes.

The Armament Agency also understands the idea of polonization as a commitment or effort to contractually limit the number of foreign components or parts in a product. This may involve locating production or assembly in Poland or establishing the capacity to perform maintenance and repairs. “The point is to shorten supply chains and make domestic plants as independent as possible from foreign entities,” emphasizes Col Frommholz.

Different Ways, One Goal

“The currently applicable offset law applies in particular to contracts concluded with the US government under the FMS (Foreign Military Sales) program. Since it is difficult to require the US government to build a specific capability at the contractual level, we simultaneously conclude separate offset agreements directly with the companies that own the relevant technologies, such as in the Wisła program with Raytheon, Lockheed Martin, and Northrop Grumman, or in the case of Apache helicopters with Boeing, General Electric, and Lockheed Martin,” explains Col Frommholz.

Another approach is to require a foreign supplier to transfer technology and production assets to the State Treasury, with the right to pass them on to Polish entities. “Our experience to date shows that this model is more practical than the rather rigid and formalized offset,” says Col Frommholz. This approach has been used, among others, in contracts related to the following programs: Narew, the Naval Missile Units, the K2 tank, the K9 self-propelled howitzer, the Homar-K rocket system, and Orka.

Another method is to create conditions for industrial cooperation within business relationships. “From a broader perspective, this is probably the most economically sound approach, since Polish and foreign industrial entities work out optimal solutions in terms of both business and implementation,” claims Col Frommholz. As a flagship example, he mentions the cooperation between WB Electronics and Hanwha Aerospace. “The companies established a joint venture to build a missile factory for the Homar-K systems from the ground up,” he adds.

Good Examples

Col Frommholz considers the commitments accompanying air defense programs as some of the most satisfying examples of Polonization. “Under the Narew program, based on the obtained licenses, the PGZ Capital Group companies will produce CAMM-ER surface-to-air missiles and launchers, with the possibility to later modernize them and offer them on other markets. The obtained know-how and knowledge transfer will make it possible to jointly develop, together with the British side, a new missile with an extended range, namely CAMM-MR,” he points out.

Opel Plant in Gliwice.

“As part of the offset accompanying the second phase of the Wisła program, the Military Armament Works [WZU, Wojskowe Zakłady Uzbrojenia] will produce electronic assemblies and cable harnesses for the world’s most advanced air defense radar, LTAMDS [Lower Tier Air and Missile Defense Sensor]; PIT-Radwar will produce antennas for the friend-or-foe identification system; and the Research and Development Centre of the Centre for Maritime Technology [OBR CTM, Ośrodek Badawczo-Rozwojowy Centrum Techniki Morskiej], thanks to its cooperation with Northrop Grumman, has already become our national expert in integrating domestic sensors with the IBCS system,” says Col Frommholz. “The latest example – in the Orka submarine procurement program, we established a transfer of knowledge and technology to the Polish defense industry in the area of MRO [Maintenance, Repair, Overhaul], which will ultimately enable us to gain full independence in servicing and modernizing the vessels.”

Technology Absorption Level

The mere desire to manufacture components for foreign systems is not enough. Plants must be prepared to use new technologies, which is related to incurring costs of building the necessary infrastructure and training workers. There is also the question of whether newly acquired skills can be used for a purpose other than participating in production tied to a single contract or for operating equipment other than that used by the Polish Armed Forces. That is why the Polish Armament Agency is always working to ensure that any technology transfer brings benefits to the domestic defense industry in the longer perspective.

“The Armament Agency determines the degree of polonization based on the absorption capacity of domestic companies – that is, how many new technologies can be implemented by an entity specializing in the production of specific components of a weapons system,” says Col Frommholz, adding that it is a costly and time-consuming process, as it often requires adapting infrastructure or preparing human resources. “That is why we must be convinced that Polish entities are able, both economically and organizationally, to handle the task of absorbing new technologies,” he says. The Ministry of National Defense cooperates in this area with the Ministry of State Assets, which oversees the state-owned defense industry.

Before signing equipment supply contracts, the Armament Agency also negotiates technology transfer conditions. “We aim for solutions that will, for example, enable us to provide MRO services for other countries, and thereby create regional service centers,” he notes. The Agency also uses a GOCO (Government Owned – Company Operated) model, partially borrowed from the United States. Under this model, equipment used for servicing and repairs, acquired from foreign suppliers along with military equipment and owned by the State Treasury, may be loaned to selected industrial entities carrying out tasks for the military.

For the supplier, offset means more work and the need to share technologies, which not all manufacturers, or governments, for that matter, are eager to do. “Foreign manufacturers understand that, given the current security situation in Central and Eastern Europe, Poland is becoming a natural logistics and service hub for NATO’s entire eastern flank,” assures Col Frommholz. “In our negotiations with the representatives of foreign companies, we always ask them to look at the map and compare the localization of Poland and their country. This realization is of enormous importance when it comes to understanding our needs and why we expect certain capabilities to be located in Poland,” he points out.

The entire process also involves many legal issues. “In its current structure, the Armament Agency has no tools to oversee contractors other than the mechanisms arising from concluded contracts. The contracting authority does not define priorities for the development of industry, technologies, or capabilities critical to the state. Nor is it responsible for developing a strategy for the development of defense potential. Therefore, we should create a center that would streamline and unify all state–industry relations in the defense sector,” believes the Deputy Head of the Armament Agency.

Investment in the Capabilities of the Armed Forces

The fact that polonization is necessary is recognized not only by entrepreneurs and organizational units of the Ministry of National Defense, but also by soldiers using equipment acquired abroad. “From the perspective of the 1st Armored Brigade, the crucial thing is not only the acquisition of modern armament but also providing an efficient and accessible system for maintaining it throughout its service life. Therefore, polonization should encompass not only the involvement of domestic industry in production, but also the development of capabilities that would enable us to carry out technical servicing, repairs, overhauls, and modernization in Poland,” believes Capt Maciej Strupiechowski, Spokesperson for the 1st Armored Brigade.

WZE SA will be producing in Poland the energy storage assembly modules for LTAMDS radars.

Referring to the experience gained from operating Leopard tanks and modernizing them to the 2PL standard, Capt Strupiechowski points out that “the development of domestic maintenance and repair capabilities is an investment not only in the defense industry, but above all in the operational capabilities of the Polish Armed Forces and the security of the state.” According to him, equally important is the possibility of direct cooperation between the user and the manufacturer or entity responsible for technical maintenance. “The observations and experiences of soldiers who operate the equipment on a daily basis can be passed on to the contractor faster, which helps to improve technical solutions and solve emerging problems more efficiently,” concludes Capt Strupiechowski.

Importance of Expertise

Gaining new competencies through international contracts is a condition set by the Polish Armaments Group (PGZ, Polska Grupa Zbrojeniowa) in talks with foreign partners. “We place great emphasis on developing our competencies wherever it is already possible. For example, Military Aviation Works No. 2 [WZL-2, Wojskowe Zakłady Lotnicze nr 2 SA] in Bydgoszcz has been designated as the facility that will carry out comprehensive modernization of the Polish Air Force’s F-16s to the F-16V version. An important element of our expertise is the Military Automotive Works [WZM, Wojskowe Zakłady Motoryzacyjne] in Poznań, where we already service Leopard and Abrams tanks. It is worth noting that in Dęblin, at a branch of Military Aviation Works No. 1 [WZL-1, Wojskowe Zakłady Lotnicze nr 1 SA] in Łódź, we will service AGT1500 turbine engines for Abrams tanks and build the only center of this kind in Europe. This proves that polonization has a very tangible dimension,” says Adam Leszkiewicz, President of the Management Board and CEO of PGZ, adding that the same applies to production. “In the case of cooperation with the American company Anduril, we also want the assembly and production of Barracuda-500 missiles to take place in Poland.” Although there are more examples of Polish involvement, the CEO of PGZ frankly says that there are also contracts where the scope of polonization is limited, as in the case of the Miecznik ships. However, at the same time he emphasizes that “we are already working to entrust the PGZ Naval Shipyard [PGZ Stocznia Wojenna] with servicing the submarines that will be built under the Orka program.”

Private companies are also keen to acquire expertise through cooperation with foreign suppliers. “Participation in the program to supply missiles for the Homar-K systems gives WB Group entry into the selected group of European manufacturers capable of producing precision-guided missile ammunition. This is a huge opportunity to build capabilities that the Polish defense industry has not had until now,” says Remigiusz Wilk, Spokesperson for WB Group.

He also observes a change in the approach of foreign contractors to the polonization requirement: “There is a clear trend toward greater openness – foreign manufacturers increasingly treat technology transfer and localizing production as standard elements of offers addressed to Poland.” Wilk emphasizes that this results both from the extensive scale of Polish orders and from the expectations expressed by the Armament Agency and the Ministry of National Defense.

There are some contracts concluded without such a requirement. This was the case with the purchase of the F-35 in 2020. It was too late to join the program as an industrial partner, and the proposed offset was deemed unpromising by the MoND. The ministry also pointed out that, thanks to the lower price achieved at the expense of the offset, more equipment could be purchased (the cost of the offset was estimated at 1.1 billion dollars). In 2025, during last year’s industry exhibition, Lockheed Martin, the producer of the F-35, expressed readiness to establish a training center in Poland for servicing these aircraft, not only for the needs of the Polish Air Force.